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May 17, 2013
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the deficit is coming down? >> i think it's great the deficit is coming down, government taxation melton freedman said, it's true, you can't spend yourself into prosperity. if you look at government spending as a share of gdp. it tracks growth almost exactly. having the deficit come down is wonderful news. >> all right. so if people are saying this fiscal restraint is like 1936-1937, all right, where we had a recession inside a depression. yeah, i think that's a lot of gar back. i'll tell you why, i want to hear you first. >> well, the taxes went up through the great depression. the way the world works, it outlines it exactly, all these people in the great depression have missed the tax variable totally. bernanke, even milton freedman missed it in the freedom of the united states. it's taxes that really caused the economy to slow down and cutting taxes in aggregate is cutting government spending. government doesn't create resource, larry, it redistributes them. every dollar they spend for one person, they take a
the deficit is coming down? >> i think it's great the deficit is coming down, government taxation melton freedman said, it's true, you can't spend yourself into prosperity. if you look at government spending as a share of gdp. it tracks growth almost exactly. having the deficit come down is wonderful news. >> all right. so if people are saying this fiscal restraint is like 1936-1937, all right, where we had a recession inside a depression. yeah, i think that's a lot of gar back....
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May 15, 2013
05/13
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the true issue with deficits. when you pad the course with too much weight it doesn't make the trip as efficiently. and i do understand everybody wants to ring the bell on smaller deficits. i'm in the club as well. we need to be be honest about it. obviously that's the main motivation. but there's another. we cosigned for all the losses. just hope it doesn't mean no reform. we need a free market in housing that isn't the government. nothing talks about free markets better than a really old book. wealth of nations 1776. hey, that was a really good year by the way. adam smith. what is the underlying premise of adam smith we can apply in ample helpings to a variety of issues in the day? that is who should best deal with the procurement? whether it's a natural resource like natural gas or whether the government should decide who gets loans or what what type of loans. no, no, no. it should be free market for free men. and as the wealth of nations pointed out. don't worry about natural gas. the government can't decide w
the true issue with deficits. when you pad the course with too much weight it doesn't make the trip as efficiently. and i do understand everybody wants to ring the bell on smaller deficits. i'm in the club as well. we need to be be honest about it. obviously that's the main motivation. but there's another. we cosigned for all the losses. just hope it doesn't mean no reform. we need a free market in housing that isn't the government. nothing talks about free markets better than a really old...
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May 14, 2013
05/13
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deficit. it's now $200 billion smaller than it was estimated just in february, $642 billion is the projection for the current fiscal year. that's 4% of gross domestic product, which is less than half in both dollar terms and percentage of gdp than it was in 2009, the first year of president obama's presidency. this shows that because of better than expected revenue, slower than expected growth in spending, in part because health care costs are slowing, the deficit is going to fall to 2.1% of gdp in 2015. so, we've had a lot of concern that we've discussed for years about the size of the u.s. deficit. it is now coming down pretty rapidly, bill. >> you know, it's symptomatic of our new normal here. we consider $3 gasoline cheap and we think $642 billion deficit is low. >> but as a percentage -- >> you know what i'm saying. >> yes, i do. but the historical standard -- >> john, does that mean that the gdp is expected to shrink -- >> what's that? >> when we talk about these percentages as a functio
deficit. it's now $200 billion smaller than it was estimated just in february, $642 billion is the projection for the current fiscal year. that's 4% of gross domestic product, which is less than half in both dollar terms and percentage of gdp than it was in 2009, the first year of president obama's presidency. this shows that because of better than expected revenue, slower than expected growth in spending, in part because health care costs are slowing, the deficit is going to fall to 2.1% of...
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May 20, 2013
05/13
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but the ceo's report find just about 1 trillion in deficit reduction and deficits rise again after 2017 and obama promised $1.2 trillion in spending cuts the ceo review finds just $172 billion and the president promised to balance budget approach, a balanced approach to the budget. but guess what? the review finds that tax hikes outweighs spending cuts by nearly 6-1. that is not balanced. however, joining us on set tonight, business insider's ceo and editor-in-chief henry blojit and henry kukis. >> i think one point i would make is the only way we are going to close the gap is by raising taxes and reducing long-term spending. >> where do you want to raise the taxes? >> i think you can raise lots of tax, the wellthy can go up, generally. >> northern more than we had, we just got $600 billion. >> if you look at a gdp basis, spending is at 22%. we have been at about 20 for both. we fwt to converge on that number if we want to balance the number. >> what's your take? >> i'm not sure what bothers me more the fact that the president's numbers didn't quite add up or the fact that he has a budg
but the ceo's report find just about 1 trillion in deficit reduction and deficits rise again after 2017 and obama promised $1.2 trillion in spending cuts the ceo review finds just $172 billion and the president promised to balance budget approach, a balanced approach to the budget. but guess what? the review finds that tax hikes outweighs spending cuts by nearly 6-1. that is not balanced. however, joining us on set tonight, business insider's ceo and editor-in-chief henry blojit and henry...
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May 15, 2013
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the history of deficit is they tend to understate it. if you forecast it up three, up three, up three, then if you jack your forecast down to minus one then you look like a total goon. what the cbo will say is up three, up three, up three, they tend to understate their revisions, what we saw yesterday was probably about half of the revision that they really would've made if they went all in and did the fully rational forecast. probably throughout the rest of the year, you're going to see bigger reductions in the deficits about three months from now. and that's going to have a good effect on markets, it's going to help the fed have some space to ease up on quantitative easing and so on. >> do you share robert's concerns about the impact of the sequester and second half of the year? >> no, i do not. we're losing about 1.5% of gdp growth. about 1% is the tax hike at the end of the year and half of that is the sequester. so far, we've overpowered that with the wealth effect and the absence of the hippopotamus, and i think that'll continue. >
the history of deficit is they tend to understate it. if you forecast it up three, up three, up three, then if you jack your forecast down to minus one then you look like a total goon. what the cbo will say is up three, up three, up three, they tend to understate their revisions, what we saw yesterday was probably about half of the revision that they really would've made if they went all in and did the fully rational forecast. probably throughout the rest of the year, you're going to see bigger...
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May 14, 2013
05/13
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now we only have a deficit less than 100 the next six months. the net issuance versus refunding is a little over 100. that means we have 400 billion, 400 billion that has to be made up. so basically think about this. that's being taken out of the market, out of the bond market. 400 billion is now in your hands, my hands and other folks's hands. and there's a few choices. it either has to go in the economy, which, you know it probably will go somewhat in the economy. it has to go to the short end of the curve trade better. we have this excess. or it has to make stocks trade higher. now, the problem is you might be worried some of that might go into the economy and, you know it might stimulate with a little bit of surge. basically, afterwards, we also have to cut back because the deficits in the future will be less than this trillion dollars. so if we don't taper back we will get into this hyper drive market. it's backwards. the fed has to taper back. because if you look at the numbers, it's so tremendous, these numbers are so tremendous that you
now we only have a deficit less than 100 the next six months. the net issuance versus refunding is a little over 100. that means we have 400 billion, 400 billion that has to be made up. so basically think about this. that's being taken out of the market, out of the bond market. 400 billion is now in your hands, my hands and other folks's hands. and there's a few choices. it either has to go in the economy, which, you know it probably will go somewhat in the economy. it has to go to the short...
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May 14, 2013
05/13
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because of growth and economy and also because of fannie mae paying back money from the government, the deficit over the next six months is shrinking massively. >> the fed is not reducing its purchase. here ate plan right now for what the fed is going to do. it's going to buy $270 billion in treasury over the next six months and 270 billion of mortgages. and this is demand the fixed income of $510 million. we'll show you supply here and take a look at the next chart. new supply, zoom in here, 142 billion of new supply and no new net mortgage, man a little from fannie mae or freddy mac. their 5 ten bell onof demand means there's going to be 368 billion of cash. if you could just zoom in on that number and that's the number that taper says is going to be money looking for a hope in the market these days. the result is a lot of money having no place to go, but perhaps the stocks, and the fed will be dropping down further. the next screen is the equity risk premium. this is the measure over the risk-free treasury rate. you can see it's already at a historic high now according to tepper's math, this
because of growth and economy and also because of fannie mae paying back money from the government, the deficit over the next six months is shrinking massively. >> the fed is not reducing its purchase. here ate plan right now for what the fed is going to do. it's going to buy $270 billion in treasury over the next six months and 270 billion of mortgages. and this is demand the fixed income of $510 million. we'll show you supply here and take a look at the next chart. new supply, zoom in...
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May 15, 2013
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deficit is shrinking more quickly than previously thought. the nonpartisan budget watchdog says revenue growth will out-pace spending over the next two years. the cbo is slashing its deficit forecast for fiscal 2014 to $642 billion. it's the smallest shortfall since 2008. they're citing rising personal income tax revenues and higher dividend payments by the likes of fannie mae and freddie mac. dan, how important is their assessment? >> well, it's very important for treasury yields. in the first part of the year, we had them go above 2% as economic growth looked strong, a bit down, but now we're moving in that direction again. but what may be a limit on them is exactly this -- the treasury isn't going to be issuing as much debt because the budget deficit's falling. the fed in the meantime is still buying a lot of treasuries, so you're starting to run into a demand and supply imbalance, where there's maybe not quite enough debt out there, if you will. we talk about having too much debt. maybe we don't have enough, and that will probably keep a
deficit is shrinking more quickly than previously thought. the nonpartisan budget watchdog says revenue growth will out-pace spending over the next two years. the cbo is slashing its deficit forecast for fiscal 2014 to $642 billion. it's the smallest shortfall since 2008. they're citing rising personal income tax revenues and higher dividend payments by the likes of fannie mae and freddie mac. dan, how important is their assessment? >> well, it's very important for treasury yields. in the...
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May 20, 2013
05/13
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deficit's coming down. but stocks can't go up forever. >> no. what i'm seeing is that we're not seeing the inflows into stock funds and mutual funds is starting to get smaller and smaller. without new money into the market, i'm sorry. everyone loves this rotational theory about people rotating into new groups. >> right. >> i don't buy that. that's just money being moved around. you need new money to make the market go up. i think we're starting to see it dry up a little bit at this juncture. that's not permanent. i do think we're fwoing to see a little bit of a dryup right here. >> thank you, peter costa. always good to see you. going out about the mid-point of the range. 22 points on the dow jones industrial. stay tuned in the second hour. maria has exclusively the president of blackrock, rob kapito. stay tuned. retail earnings tomorrow. could set the tone for tuesday that traditionally in 2013 has been higher. second hour of the "closing bell" with maria is coming up right now. i'll see you tomorrow. >>> and it is 4:00 on wall street. do you k
deficit's coming down. but stocks can't go up forever. >> no. what i'm seeing is that we're not seeing the inflows into stock funds and mutual funds is starting to get smaller and smaller. without new money into the market, i'm sorry. everyone loves this rotational theory about people rotating into new groups. >> right. >> i don't buy that. that's just money being moved around. you need new money to make the market go up. i think we're starting to see it dry up a little bit at...
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May 20, 2013
05/13
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understand how offshore tax loopholes raise their tax burden and how those loopholes add to the federal deficit and why those tax loopholes ought to be closed. the tax -- the -- excuse me, the cost-sharing agreement is kind of step one on the tax avoidance road. it is entered into with its irish affiliates. but the agreement is not about dividing costs even though it's called a cost-sharing agreement. since all of the signatories to that agreement work for apple and all of the costs are paid out of the same pocket, and if you need additional proof of the fact that the cost-sharing agreement, so called, is not an arm's length arrangement, look at the results. over the last four years, apple's offshore subsidiaries paid $5 billion in costs, received far, far more back than they paid. and apple on the other hand, itself, when paying a large amount relatively received a small amount back. about 2 1/2 times the profits were received by those irish subsidiaries and there they sit. and was obtained by -- >> all right. we've been listening to senator levin down on capitol hill details -- detailing the
understand how offshore tax loopholes raise their tax burden and how those loopholes add to the federal deficit and why those tax loopholes ought to be closed. the tax -- the -- excuse me, the cost-sharing agreement is kind of step one on the tax avoidance road. it is entered into with its irish affiliates. but the agreement is not about dividing costs even though it's called a cost-sharing agreement. since all of the signatories to that agreement work for apple and all of the costs are paid...
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May 15, 2013
05/13
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question question t administration is back on its heel, things like immigration, gun reform, maybe a deficit deem or entitlement form. in other words, republican, we had mitch mcconnell, senator mcconnell on our show last night. republicans are moving on the aumpls. they will use these hearings, whether it's benghazi the secret appearance of the a.p. phone calls or the irs. the republicans smell blood for 2014. so the president is noeft most certainly on his heels. he needs to make a dramatic announcement. i could be dead wrong, timer. maybe out of the blue, we're not figuring this, there is an announcement about something like syria. sometimes presidents will do this for national security purposes. maybe. maybe. i don't know anything about that. all i know is he met with the treasury team a few hours ago. that meeting, i think, is going to look into this announcement. i think one leads to the other. >> you can almost hear the gop recalculating how they're going to go about attacking the administration's second term agenda at this point. >> absolutely. the question sheer about the democrats
question question t administration is back on its heel, things like immigration, gun reform, maybe a deficit deem or entitlement form. in other words, republican, we had mitch mcconnell, senator mcconnell on our show last night. republicans are moving on the aumpls. they will use these hearings, whether it's benghazi the secret appearance of the a.p. phone calls or the irs. the republicans smell blood for 2014. so the president is noeft most certainly on his heels. he needs to make a dramatic...
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May 16, 2013
05/13
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he will not be able to reduce the deficit and that his way is the only viable option. >> we won't penalize that. we won't drive wealth creator away from our shores, but bring them here. we are traveling a hard road but we're making progress. and with your help, we will get there. >>> $1.8 billion, that's how much sinopec engineering has reportedly raised in its ipo. the company sinopec is said to have priced the deal at the bottom of the range. the group reportedly sold more than $1.3 billion at 10.50 hong kong dollars per piece. francis is back with us now. >> can you hear me now? >> great. good stuff. much better. what is the traction of this listing? >> the largest company necessary china are in the world and they still have a lot of engineering work to do. but you look at the ipo numbers, the public tranche is 28 times what was ascribed. and that will be a huge success, but they can only price at the lower end of the range that show the institutions are really not there. institution will not support the share. in this top of the range. so that really shows the support on its debut. it
he will not be able to reduce the deficit and that his way is the only viable option. >> we won't penalize that. we won't drive wealth creator away from our shores, but bring them here. we are traveling a hard road but we're making progress. and with your help, we will get there. >>> $1.8 billion, that's how much sinopec engineering has reportedly raised in its ipo. the company sinopec is said to have priced the deal at the bottom of the range. the group reportedly sold more than...
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May 16, 2013
05/13
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i get it, sometimes you need to dip in and create deficit. but if there is something broken, you can cause things to move up, whether it is gdp. you can try to kick-start housing by trying to silence rates, but in the end the key to house something sustainability. >>> let's switch gears. i'm going to read you something, a tweet. okay? associated press, irs, ask not what can you do for your country, ask what your country can do to you. i didn't write that. i think it is clever. a tea party person didn't write that. even though there is nothing wrong with being a conservative voice. bill gross. that was bill gross' tweet for today. the point of this is the country is not happy. now whether you look at the associated press story, whether you look at the residual issues of benghazi or specifically you look at the irs, we know a couple of things. the country's divided. i'm not saying divided is bad. throughout our history maybe the division of government is one of our greatest assets. the tug-of-war goes on constantly. it is a good thing. it might
i get it, sometimes you need to dip in and create deficit. but if there is something broken, you can cause things to move up, whether it is gdp. you can try to kick-start housing by trying to silence rates, but in the end the key to house something sustainability. >>> let's switch gears. i'm going to read you something, a tweet. okay? associated press, irs, ask not what can you do for your country, ask what your country can do to you. i didn't write that. i think it is clever. a tea...